Tag Brazil petroleum

Two bodies were found inside an oil ship that exploded off Brazil’s coast, increasing the death toll to five, the oil workers union said on Thursday.

The Oil Workers Union of the state of Espírito Santo, where Wednesday’s explosion took place, said rescue teams are searching for four who remain missing. It said 10 workers were injured in the blast.

The union said on its Facebook page that the two bodies were found inside the engine room of the vessel, one of many floating oil production, storage and offloading units that state-run oil company Petrobras employs in developing Brazil’s massive offshore oil fields.

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Brazilian state-run energy giant Petroleo Brasileiro (PBR, PETR4.BR), or Petrobras, said late Monday that a new subsalt oil discovery opens a new exploration frontier in the Santos Basin, where billions of barrels of crude have already been discovered.

The first well drilled in the offshore BM-S050 block, dubbed Sagitario, was found to contain high-quality oil, Petrobras said. Petrobras operates the block with a 60% stake. The local unit of BG Group PLC (BG.LN) holds 20%, while Repsol Sinopec Brasil retains the remaining 20%.

The discovery is significant because it was made to the west of the cluster of oil discoveries made deep under a thick layer of salt off Brazil’s Atlantic Ocean coast in the mid-2000s. The Lula field, which holds estimated recoverable reserves of between 5 billion and 8 billion barrels of oil equivalent, or BOE, and is currently producing about 100,000 barrels a day, and the Sapinhoa field that started pilot production earlier this month both sit due east of the Sagitario discovery. Sapinhoa is estimated to hold recoverable reserves of 2.1 billion BOE.

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Brazil’s Senate on Wednesday approved a plan to distribute oil royalties more widely among feuding states, a small step toward relaunching the development of the country’s vast offshore reserves.

But the bill still faces several hurdles that could stall new investments in deepwater offshore areas. The proposal now faces a contentious vote in the lower house of Congress and potentially a slew of law suits by oil-producing states that stand to lose oil revenue.

At stake is the development of some of the world’s largest crude reserves held in an area known as the subsalt, a region the size of New York state believed to hold more than 50 billion barrels that could turn Brazil into a major oil exporter.